Electronic transaction verification system

ABSTRACT

An electronic transaction verification system for use with transaction tokens such as checks, credit cards, debit cards, and smart cards that gathers and transmits information about the transaction token and biometric data is described herein. The electronic verification system includes a biometric data device for recording and/or transmitting biometric data taken at the transaction location. The electronic system is adapted to accept or deny a transaction based on the comparison result generated by comparing the biometric data and the information obtained from the transaction token at the transaction location with information previously stored in one or more databases.

CROSS-REFERENCE TO RELATED APPLICATIONS

This application is a continuation of U.S. patent application Ser. No.10/994,934 filed Nov. 22, 2004, which is a continuation-in-part of U.S.patent application Ser. No. 10/816,037, filed Apr. 1, 2004, now U.S.Pat. No. 7,231,068, which is a continuation-in-part of U.S. patentapplication Ser. No. 09/335,649, filed Jun. 18, 1999, now U.S. Pat. No.6,728,397, which in turn, claims the benefit of U.S. ProvisionalApplication No. 60/089,959 filed Jun. 19, 1998. This applicationincorporates U.S. Pat. No. 6,728,397 by reference into this descriptionas fully as if here represented in full.

BACKGROUND OF THE INVENTION

1. Field of the Invention

The present invention generally relates to credit and identityverification systems. More particularly, the present invention relatesto credit approval and fraud protection at the point-of-sale for atransaction wherein biometric information is used to verify the identityof a person presenting a token for payment as an authorized user for theassociated account and that the account is in order for the transaction.Transaction tokens can include a negotiable instrument, a credit card, asmart card, a loyalty card and a debit card. Information on theauthorized accounts can be stored in either a token-based or tokenlesselectronic transaction system.

2. Description of the Related Art

There are devices known in the art that gather biometric data frompersons for storage or for comparison with stored biometric data forpurposes of identity verification. An example of storing biometric datafor identity verification is U.S. Pat. No. 4,213,038 to Silverman, etal., for an access security system. Silverman, et al, discloses storinga fingerprint on a card, in either an actual print or “micropattern,”and the card is read by a control means. The fingerprint recordation isancillary to the preferred function of the card which is identificationbased upon solely the microperforation of the card, which is notdirectly related to the fingerprint.

Check funds verification systems are also known in the art that allowmerchants and others to verify that customers have funds available in aspecific checking account. U.S. Pat. No. 5,484,988 to Hills, et al.,discloses a check-writing point-of-sale system that provides for remoteverification of funds availability. Hills, et al., is particularlydirected to the purchase of goods through an electronic funds transfer.

U.S. Pat. No. 4,253,086 to Szwarcbier discloses a process and apparatusfor positive identification of customers that is particularly disclosedas using a fingerprint on a credit card and comparing the fingerprint ofthe customer to that on the card, and selectively, with a master printon file. Szwarcbier also discloses a printed fingerprint card.

There are “smart cards” known in the art which include fingerprintidentification means, such as U.S. Pat. No. 4,995,086 to Lilley, et al.,U.S. Pat. No. 4,582,985 to Löfberg, U.S. Pat. No. 4,993,068 to Piosenka,et al., and U.S. Pat. No. 5,180,901 to Hiramatsu. All of thesereferences disclose smart cards that have, at least, a storedfingerprint in a local memory (such as magnetic tape or integratedcircuit) that interacts with a reading means at the point-of-sale toassist in customer identification.

An example of an actual fingerprint sensor is U.S. Pat. No. 5,745,096 toHsumi, et al., which is for a surface-shaped sensor identificationdevice. The Hsumi, et al. device is focused on the specific element ofsensing and recording the fingerprint, as opposed to a complete identityverification system.

There are various types of biometric measurements in common use today.The types of biometric measurements include fingerprint verification,hand geometry, voice recognition, retinal scanning, iris scanning,signature verification, and facial recognition. Each biometric deviceand system has its own operating methodology. The process for any givenindividual usually begins with an enrollment process. The systemcaptures one or more samples of the biometric. The samples are stored ina “biometric template” (also referred to herein as a biometricdatabase), and are used for future comparison during authentication.Once enrollment and storage are complete, users authenticate themselvesby matching the template against current input (“live data”). Comparisonof the live data and the template results in a simple binary yes/nomatch.

Fingerprint verification is a well-known type of biometric measurement.If properly implemented, fingerprints provide high accuracy and atrelatively low cost. Hand geometry measures physical characteristics ofthe individual's hand and fingers and is most widely used in physicalaccess control systems. Voice recognition remains difficult toimplement. Despite recent advances in voice recognition technology,background noise, microphone quality, the common cold, and anxiety canalter the human voice enough to make voice recognition difficult, if notimpossible. Voice recognition technologies include telephoneauthentication. Extraction and pattern matching algorithms embedded oncomputer chips are used to analyze voices. Retinal scanning is wellestablished and highly accurate, however, it requires that theindividual look directly into the retinal reader. Retinal scans shoot alow-intensity beam of light into the eye and record the pattern of veinsin the eye. Iris scanning overcomes most of the problems of retinalscanners and does not require direct contact with the scanner, nor doesit require the individual to remove eyeglasses. The technology works byscanning the unique random patterns of the iris. Unlike retinal veinpatterns that can change over time, the iris is unique and does notchange during a person's lifetime. Facial recognition systems measurecharacteristics such as the distance between facial features (e.g.,pupil to pupil) or the dimensions of the features themselves (such asthe width of the mouth). Neural network technology or statisticalcorrelations of the facial geometric shapes are used with this kind ofsystem. Signature verification is a relatively accurate system and istreated separately from the other forms of biometric systems describedherein.

With fraudulent check losses alone reaching ten billion dollarsannually, the banking industry is striving for ways to reduce theselosses. Many proposals have been presented over the last five to tenyears. One of the least sophisticated approaches is placing theindividual's fingerprint on a sticker and attaching the sticker to thecheck being presented. Among the more sophisticated approaches is theuse of smart cards that have a chip containing biometric information ofthe account holder. The biometric information stored on the chip can becompared with the biometric information of the person presenting thesmart card at the transaction location. However, these alternativemethods of reducing fraudulent activity are not meeting the needs ofindustry. The use of fingerprint stickers are a deterrent for the leastsophisticated forger, but the process of identifying the fingerprint ona sticker can take a long time in crime labs due to their backlog andtheir obvious priority of processing fingerprints obtained from crimescenes in which felonies involving violence occurred. Smart cards withembedded biometric chips are used with credit cards or debit cards, butstill do not prevent the more sophisticated identity thief. The moresophisticated identity thief steals account information and thenproduces his own credit card containing his own biometric informationembedded in the chip. When the identity thief presents his biometricinformation at the transaction location, the verification is being madeagainst an already faulty biometric sample stored on the chip.

Tokenless point-of-sale payment processing systems have also beendeveloped recently. One such system is described in U.S. Pat. No.6,581,042 to Pare, et al. that uses biometrics obtained at thepoint-of-sale for verifying the identity of an individual as anauthorized user of the tokenless payment system. Tokenless processingsystems are intended to speed up the process of check-out at atransaction location by not requiring the person to present a physicaltoken and by verifying the identity of the person presenting paymentwith the tokenless processing system. A drawback of current tokenlesssystems is that they only verify tokenless transactions. Tokenlesssystems do not verify the individual's identity or cross compare with atoken-based transaction processing system when a transaction token ispresented for payment at the point-of-sale. Therefore, unless thetokenless transaction system can be combined with verification of tokentransactions presented at the point-of-sale the tokenless transactionsystem does not prevent and is vulnerable to fraud. For example, aperson registers with the tokenless processing system by providingaccount information and a biometric for identification during theprocessing of purchases at the point-of-sale by the tokenless processingsystem. The person registering with the tokenless system believes thatall purchases will be authenticated by his biometric. However, this doesnot prevent a thief from either stealing or fabricating the registeredperson's physical token (e.g., check, credit card, etc.) and presentingit at a location that uses the tokenless processing system. Unless thephysical token presented is checked against the tokenless processingpayment system to determine if the account being accessed needs to beauthenticated by a biometric, the physical token could be acceptedwithout verifying the identity of the person presenting the token forpayment.

SUMMARY OF THE INVENTION

The present invention, in its simplest form, combines the use of validbiometric samples obtained from authentic identifications (IDs) withbiometric samples provided by a person at a transaction location,thereby verifying that the biometric information presented for atransaction is a valid biometric for a particular person. In addition,the ID and the biometric sample can also be checked against knowninvalid users. Although it is possible for someone to counterfeit whatis believed to be the authentic ID, in such cases, the identity thiefprovides an actual fingerprint that has been taken and placed on thetoken or on the transaction slip. When the token is returned to thetransaction location as forged, counterfeit, stolen, etc., thefingerprint is entered into the database of known invalid users, thuspreventing any further identity theft activity by this person on theverification system. The present invention, in its most complex form,adds additional safeguards, such as verifying the ID with informationfrom the state. This ensures that an ID has not been altered, and is infact an authentic state-issued ID (e.g., driver's license). Another suchsafeguard is verifying the information at the processing center of thetoken with the original information that a bank or token companyobtained at the creation of the bank or token account.

The present invention, in one exemplary embodiment thereof, comprises averification system for check/negotiable instruments or other form oftokens, which has the ability to scan the information from negotiableinstruments such as the magnetic ink character recognition (MICR) line,and gather biometric data such as fingerprints. The system alternatelyscans driver's licenses or other identification cards, and obtains andtransmits a signature of a customer, preferably all occurring at atransaction location (e.g., point-of-sale) for purposes of identity andfund verification. However, the electronic transaction can occur atplaces other than a point-of-sale. For example, the electronictransaction can occur over the Internet, as part of an Internet-basedtransaction and include transmission of biometric data or signatures foruser verification. Therefore, in general, transaction location refers tothe place where the user or customer enters his information, such asaccount data or biometric data into the electronic transactionverification system. The verification system preferably digitizesvarious indicia of the check, the preferred indicia being the magneticink (MICR line) on the check, tendered by the customer at thetransaction location, and transmits the data through a communicationsmedium, to a processing system including a negotiable instrumentinformation database, whereby the inputted data is compared with anexisting database of information to determine if the customer at thepoint-of-sale is in fact authorized to use the account, and if theaccount is in satisfactory condition for transaction approval. Thecommunications medium can be a broadband connection, a dial-upconnection, a direct communications link, a satellite link, or fiberoptic cable or any other communication link that allows communicationsbetween a transaction location and a central or local processing systemand database.

In this exemplary embodiment, the verification system alternativelyincludes a device and method for recording and/or transmitting abiometric measurement of the customer at the location of the transactionand, in the case of a fingerprint biometric, printing the fingerprint onthe negotiable instrument, either in actual or digitally encoded form,such that the fingerprint can be later checked against a biometricdatabase of existing fingerprints at such time as the instrument isprocessed at a bank, which provides an added means of security in theevent that fraudulent activity has been discovered between the time ofreceiving the token at the transaction location and the time it ispresented at the processing center. If the system includes a device forscanning an information card that contains biometric data, such as aproper fingerprint printed on a driver's license, and/or signature, thenthe fingerprint and signature of the user can alternatively be comparedto the recorded data on the card, in addition to or instead of,transmission of the various databases.

In another embodiment of the verification system, a negotiableinstrument or other token is swiped and the fingerprint issimultaneously taken and digitized whereby the combined data istransmitted to a central (or local) processing system that includes anaccount information database and a biometric database, and thetransmitted data is compared with identification data already on file,and the central (or local) processing system determines if theidentification data of an authorized user on file matches with thetransmitted data from the user at the transaction location. Localsystem, in the present context refers to a system that is in physicalproximity to the transaction location (e.g., same store). The systemthen returns the results of the decision on approval to the transactionlocation. A device at the transaction location displays the decisiondata and/or prints out a hard copy indicating whether the negotiableinstrument/token was approved or denied.

As is well known in the banking industry, the MICR line on a checkincludes the bank routing number, account number, check number, checkamount, and other information, that can be printed near the bottom ofthe check in magnetic ink in accordance with generally applicableindustry standards. In operation, the central (or local) processingsystem receives data from the transaction location and then determinesif the “ABA” magnetic number on the MICR line of the check is a validnumber, if the fingerprint data is that of an account owner authorizedto use that account, and/or if the signature is that of the authorizedaccount owner, whereby any negative response to these decisionspreferably causes return of the data indicative of the negative responseto the transaction location. Upon affirmative indications in thedecisions, the central (or local) system retrieves the frequency of theaccount accesses to determine if the current requested access is inexcess of a predetermined limit of an allowable number of accesses. Ifthe current access is in excess of the pre-determined allowable limit,then the data is returned to the transaction location indicating theunacceptable request to exceed the limit, and thus, disapproval of thetransaction. If the current access is not in excess of the allowabledetermined limit, then the verification of the check is approved andsuch verification is used to update the frequency of account accessdatabase, and the approval is returned to the transaction location.Various account conditions can be used, alternatively, to verify thecondition of an account. Such conditions can include “outstandingchecks,” “returned checks,” and “account closed” among others. Forexample, if there are outstanding checks on the system for a user'saccount, then the present invention can return an indication to thetransaction location that the user's account is not in condition tosatisfy the negotiable instrument. Likewise, if the token is a creditcard, debit card, loyalty card, smart card or similar-type token, thecondition of an account can include “exceeding credit limit,” “unpaidbalance,” “insufficient funds,” etc.

In a further exemplary embodiment, the transaction database and/or thebiometric database within a tokenless payment system can be used toverify or authenticate the person presenting a token at the transactionlocation. The token being presented at the transaction location isswiped obtaining the necessary account information and sent to aprocessor for comparison with account information stored in thetransaction information database within the tokenless processing system.If a match occurs with account information stored in the transactiondatabase of the tokenless system, the token system then requires thetoken to be authenticated by a biometric. The biometric information isthen sent either separately or in parallel with the transactioninformation to the tokenless system for approval.

The verification system preferably includes the capability to providereports on user/customer activity to a merchant or business uponrequest. The merchant directs an inquiry to the central (or local)system which is in communication with a series of databases and whichpreferably includes databases indicative of: a number of transactionsfor a specific account; the location of the transactions for suchaccount; and a user/customer list and relevant data associated with theuser/customer. Depending upon the inquiry generated from the merchant,the main (or local) system retrieves the requested information togenerate a report on a specific customer, and then returns the report tothe merchant.

Alternatively, the verification system can be used in conjunction with abank proofing machine during batch processing of checks. When theproofing machine scans the magnetic number from the check, theidentification data imprinted on a check at the transaction location iscompared with account owner identification data as recorded andmaintained by the bank to determine if the correct account ownersubmitted the check. The verification system can also be used inconjunction with an Electronic Check Exchange (ECE) system in which thecheck information is exchanged electronically, in lieu of or in additionto the exchange of paper checks. For forward presentment, an ECE systemis usually referred to as an Electronic Check Presentment (ECP) system.The verification system can be used in conjunction with AutomaticClearinghouse (ACH) processing systems. Furthermore, the verificationsystem can be used in conjunction with a token processing system such asa credit card or debit card processing center to verify the informationread from the magnetic strip on the token with information recorded andmaintained by the credit or debit card processing center.

Accordingly, the present invention has a practical application in thatit provides an electronic transaction verification system to a merchantfor use at a transaction location, which determines if the user/customeris authorized to use a specific account, and if the account is insatisfactory condition to remit funds for the negotiable instrumentdrawn against it.

The present invention of the electronic transaction verification systemfurther has industrial applicability in that it provides a computersystem which correlates biometric data that is precise with not easilyforgeable measurements of a customer, such as fingerprints and/or datafrom identification cards, and that can be digitally encoded andprocessed along with the information relative to a negotiable instrumentsuch that the risk of the merchant accepting a bad instrument is greatlyreduced. Thus, the present invention can be quite economicallybeneficial to a merchant utilizing the system.

More generally, the invention is applicable to electronic transactionverification of a person initiating a transaction with a token at atransaction location. In the context of the invention, withoutlimitation, a transaction token can include a negotiable instrument, acheck payable on demand, a substitute check, a traveler's check, a debitcard, a credit card, a smart card, a promissory note, food stamps, orany other token presented at the point-of-sale for payment. Thepoint-of-sale can be a physical or virtual (i.e., web site) storelocation. The token is presented at a transaction location to a vendoror merchant. The transaction is initiated by the user presenting a tokenat the transaction location along with a biometric measurement beingtaken to verify the identity of the individual against informationstored in a database. Information read electronically from the token isused to determine the condition of a user account.

A substitute check, as used herein, has the meaning given to it in the“Check Clearing for the 21^(st) Century Act,” Public Law 108-100, Oct.28, 2003.A substitute check is a legal equivalent of the original checkthat has been truncated. It contains an image of the front and back ofthe original check and bears a MICR line containing all informationappearing on the MICR line of the original check.

BRIEF DESCRIPTION OF THE DRAWINGS

The invention is better understood by reading the following detaileddescription of the invention in conjunction with the accompanyingdrawings.

FIG. 1 is a block diagram of an exemplary embodiment of the electronictransaction verification system illustrating a verification unit incommunication with a central processing system and identificationdatabase.

FIG. 2 is a block diagram illustrating an alternate embodiment of thepresent invention whereby the electronic transaction verification unitis in communication with a central database that returns an approvaldecision to the electronic transaction verification unit.

FIG. 3 is a flow chart of an alternate embodiment of the verificationsystem illustrating the electronic transaction verification unittransmitting the identifying data of a check and a fingerprint to thecentral system for processing.

FIG. 4 is a flow chart illustrating the processing of transmitted databy the central system upon receipt of the data from the electronictransaction verification unit at the transaction location.

FIG. 5 is a block diagram illustrating the main system generating acustomer report based upon receipt of an inquiry from a retailer.

FIG. 6 is a block diagram illustrating a proofing machine interactingwith the biometric data scanner at the transaction location, with theinterrelation of a first biometric database for known customers and asecond biometric database for known invalid data.

FIG. 7 illustrates an exemplary embodiment of the electronic transactionverification system including a verification unit operating inconjunction with a tokenless processing system having its owntransaction and biometric databases.

DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENT

The following description of the invention is provided as an enablingteaching of the invention in its best, currently known embodiment. Thoseskilled in the relevant art will recognize that many changes can be madeto the embodiments described, while still obtaining the beneficialresults of the present invention. It will also be apparent that some ofthe desired benefits of the present invention can be obtained byselecting some of the features of the present invention withoututilizing other features. Accordingly, those who work in the art willrecognize that many modifications and adaptations to the presentinvention are possible and may even be desirable in certaincircumstances and are a part of the present invention. Thus, thefollowing description is provided as illustrative of the principles ofthe present invention and not in limitation thereof, since the scope ofthe present invention is defined by the claims.

Referring now in greater detail to the drawings, in which like numeralsrepresent like components throughout the several views, FIG. 1illustrates a block diagram of an exemplary embodiment of theverification system illustrating an electronic transaction verificationunit 10 in communication with a central processing system 12 thatincludes an identification database 14. The identification database caninclude a number of databases used in the identification process such asa biometric database of known customer data, as well as a separatedatabase of known invalid users. The database of known invalid users canbe established by correlating a biometric presented at a transactionlocation that is used with a fraudulently obtained transaction token,and storing the biometric as invalid. Central processing system 12 canbe a main system remote from the transaction location. While a check isdisclosed as one type of token to be processed in an exemplaryembodiment of the present inventive system, other tokens can beprocessed in the same manner as disclosed herein. Negotiable instrument,as the term is used herein is defined in Article 3 §104 of the UniformCommercial Code. An instrument is negotiable if it is: (1) a writteninstrument signed by the endorser or maker; (2) an unconditional promiseto pay a certain amount of money, either on demand or at a future date;and (3) payable to the holder or bearer. Examples of negotiableinstruments are checks, bills of exchange, and promissory notes. A checkas used herein means a draft, payable on demand and drawn on a bank, ora cashier or teller's check. This is the customary definition of acheck. The exemplary embodiment of the electronic transactionverification unit 10 is comprised of, at least, a check scanner or tokenreader 16 and a biometric data-gathering device 18, such as afingerprint recording device.

Many check scanning devices are known in the art that scan the magneticink on the bottom of checks and such devices range in use frompoint-of-sale devices to scanners used at banks, where the more advanceddevices are referred to as bank “proofing” machines. However, suchdevice alternately includes the capability of video digitization of thecheck or gathering of other characteristics of the check that are usefulfor comparison.

The biometric recording device 18 preferably digitizes the fingerprintof a customer at the point-of-sale for transmission to a remotebiometric database. Many devices for digitization and transmission offingerprints are well known in the art, such as the devices of digitalbiometrics. Other biometric devices such as retinal scanners andvoiceprints are alternately used with, or in lieu of, the exemplaryfingerprint scanner. Such biometric devices are commercially availableand adaptable for use with the invention. The electronic transactionverification unit 10 also preferably includes a card reader/scanner,such as a driver's license scanner 20 which scans information (e.g.,name, address, date of birth, driver's license number) from a driver'slicense, which is especially useful in states that put information, suchas fingerprints, in a computer-readable medium such as a magnetic strip(e.g., a California license) or a bar code (e.g., a Georgia license) onthe driver's license. When the license contains this information (e.g.,name, address, date of birth, driver's license number, the electronictransaction verification unit 10 can perform an initial comparisonbetween the biometric recorder device 18 and the device's licensescanner 20 for determination of the user's/customer's identity, inaddition to or instead of, transmitting biometric data to the biometricdatabase of the central processing system 12. The information (e.g.,name, address, date of birth, and driver's license number) gathered fromthe license scanner 20 can also be verified with information licensedfrom a state division of motor vehicles in order to authenticate adriver's license. Finally, the electronic transaction verification unit10 preferably includes a signature-taking device 22 that allows acustomer to write his or her signature on the device that then encodesthe signature into digital format for transmission. Such transmissionscan occur with or separately from the transmission of the checkidentification and biometric data. There are many devices known in theart that allow a signature to be digitized for storage and comparison,and any of such devices will work satisfactorily in the presentinventive system.

The electronic transaction verification unit 10 is preferably a computerplatform which has the capability to receive, digitize and process theincoming data from the devices, shown by block 24, for transmission to acentral processing system 12. The central processing system 12 can beremotely located from the electronic transaction stations or can be atthe same location as the electronic transaction station, e.g., anin-store central processor and database connected to electronictransaction stations by a local area network. The other devices can beintegrated with the computer platform of the electronic transactionverification unit 10, however, the devices can also be independent fromthe computer platform as long as they are in connection with theelectronic transaction verification unit 10 sufficient to transmit andhave received by the unit 10 the relevant data from the devices. Thecentral processing system 12 is in connection with, at least, anidentification database 14, which at a minimum contains the relevantspecific identification data related to various checking and/or creditaccounts. The identification database 14 can be a hard drive on thecentral processing system 12, computer platform, or other type of memorydevice located either locally or remotely, but in connection with, thecentral processing system 12. Thus, in its most basic form, the presentinvention solely generates and records identification data of thecustomer relevant to a single sale and acceptance of a token at atransaction location through recordation of the specific tokenidentification and biometric data of the customer at the transactionlocation, which is then transmitted by the various devices of theelectronic transaction verification unit 10 for recordation. When thesimple recordation of the event is effected, it is preferable that theelectronic transaction verification unit 10 output a fingerprint (orother biometric data) for inputting on the specific check, negotiableinstrument, or in conjunction with another type of token at thetransaction location, shown by output 26, either in actual or digitallyencoded form, whereby this identifying characteristic of the personcashing or tendering the check is contained upon the check itself andbanks processing the check have the capability to compare that imprintedfingerprint with fingerprints on file for the actual account holders, ifnecessary. However, the printing of the fingerprint on the check or inconjunction with the token (e.g., credit card receipt) can bealternately used in any embodiment of the present inventive verificationsystem.

FIG. 2 illustrates an alternative embodiment of the electronictransaction verification unit 10 in communication with a centraldatabase 30 such that the central database 30 allows the data stream ofthe electronic transaction verification unit 10 to be acted upon bydecision block 32 to determine if the token verification is approved ordenied, and then returns the approval decision to the electronictransaction verification unit 10. In such embodiment, the computerplatform receives, processes, and transmits the data of the variousdevices, shown by logic block 28, to the processor 12 for comparisonwith information stored in identification database 14 included in thecentral database 30, via a communications link, for a simple comparisonstep to determine approval. The central database 30 can include acustomer account information database (i.e., transaction informationdatabase), a biometric database of known customer biometric data, aswell as a separate database of known invalid users. The database ofknown invalid users can be established by correlating a biometricpresented at a transaction location with a fraudulently obtainedtransaction token and storing the biometric as invalid.

At the central processor 12, the incoming data is compared, either inparallel with or separately with token identification data, with theexisting known data for authorized users of accounts stored in centraldatabase 30, shown by decision block 32, and an approval is made as towhether or not to accept the token. Either a yes decision 34 or a nodecision 36 on approval is then re-transmitted back to the computerhardware platform 28 of the check verification unit 10. While the checkverification unit 10 is shown in communication with a processor 12 anddatabase 30 remotely located thereto, it is not necessary that thecentral processing system 12 or the database 30 be located remotely tothe electronic transaction verification unit 10. In fact, the electronictransaction verification unit 10 and central processing system 12 can beself-contained at the transaction location whereby the central database30, or the account information and biometric databases are continuallyupdated within the electronic transaction verification unit 10 througheither a data connection to a master database or through periodic manualupdates from storage media such as floppy disks or CD ROMs. In such anembodiment, the electronic transaction verification system is preferablyself-contained and includes all the necessary devices for scanningdrivers' licenses 20, gathering biometric data (e.g., fingerprints) 18,or scanning checks/reading tokens 16 (gathering check or tokeninformation data) within one unit comprising the system.

FIG. 3 is a flow chart of an exemplary embodiment of the processinglogic of the electronic transaction verification system showing theelectronic transaction verification unit 10 where a check or token isswiped, shown by logic block 38, and a fingerprint is taken, shown bylogic block 18, with the fingerprint then being digitized, shown bylogic block 19. Both the check information data and the biometricfingerprint data are unified at the transmitting data platform, shown bylogic block 40, for parallel transmission. The transmitted data thenreaches the central processing system 12 that is in communication with acheck or token account and biometric identification database 14 suchthat a decision is made within the central processing system 12 inregard to check or token approval. As discussed previously, theidentification database 14 can include a plurality of databases used inthe identification process. One of these is the biometric database ofknown customer data. An additional biometric database of known invalidusers can also be established. The identification database 14collectively refers to the one or more biometric databases. The centralprocessing system 12 performs a decision determining if the check/tokeninformation and biometric data are consistent with an authorized userfor the account against which the check is drafted or token is provided,shown by decision block 42, whereby a yes decision 44 or a no decision46 is returned to the transaction location, shown by logic block 48.Upon return of the data from the central processing system 12, the dataindicative of the decision is displayed, shown by display block 52,and/or a hard copy is printed out, shown by document block 50,indicative of the decision made, and alternatively, the grounds foracceptance or rejection.

The present invention accordingly utilizes an inventive digital processwhereby a dataset originates from the transaction location from theelectronic transaction verification unit 10, shown by logic block 54, asshown in the processing logic flow chart of FIG. 4, and is preferablyprocessed on the central processing system 12. A decision is made as towhether information on the MICR line (e.g., “ABA” number) or on thetoken is valid, shown by decision block 56, and then a decision is madeas to whether the biometric data (e.g. fingerprint) is that of anauthorized user, shown by decision block 62, Next, a decision (optional)is made as to whether the signature presented is that of an authorizeduser, shown by decision block 68. An authorized user is an individualauthorized to use the system. An authorized user can be the accountowner. An authorized user can also be the payee of a check, a subsequentpayee or any other individual authorized to access an account in thesystem. Affirmative responses to these decisions in blocks 56, 62 and68, shown by “yes” arrows 58, 64, and 70, respectively, preferably allowfurther processing of the data. Negative responses, shown by arrows 60,66, and 72, respectively, preferably effect a return of data to thetransaction location indicating that the transaction is disapproved,shown by block 74.

Once affirmative responses have been received to decisions 56, 62, and68, then the data can be further processed by accessing a frequency ofaccess database 78 which has information on accounts based upon thenumbers of inquiries to the system for a specific account, shown bylogic block 76, and such information is maintained and updated in thefrequency of account access database, shown by database 78, which can beeither integrated with or remote to the central processing system 12.Then a decision is made as to whether the current access is in excess ofa predetermined allowable amount of access inquires to the system for aspecific account, shown by decision block 80, and if the current accessis in excess of the allowable pre-determined amount, shown by “yes”arrow 82, then the data is returned to the transaction locationindicating that the requested access exceeds the allowable amount, shownby logic block 84, and thus that the transaction is disapproved.Otherwise, if the current access is not in excess of the allowablepre-determined amount, shown by “no” arrow 86, then the electronictransaction verification request is approved, shown by logic block 88.Other measures can also be used in lieu of, or in addition, to thesesteps, to verify the condition of the account. Several of the measureswere identified above.

Upon approval, the information regarding approval is transmitted, shownby arrow 90, to the frequency of account access database 78 for updatingof the records contained therein. The information regarding the approvalof the electronic transaction is then returned to the transactionlocation and electronic transaction verification unit 10, shown by logicblock 92.

The steps of the processes set forth in FIG. 4 are preferably performedby software being executed on the computer platform comprising thecentral processing system 12, located either at the transaction locationand integrated with the electronic transaction verification unit 10, orlocated remotely thereto. One of skill in the art of computerprogramming can determine from the present disclosure and the flowcharts disclosed herein the objects sufficient to write a program forthe computer platform sufficient to perform the tasks as disclosedherein.

In the exemplary embodiment illustrated in FIG. 7, the transactiondatabase 33 and/or the biometric database 35 within a tokenless paymentsystem can be used to verify or authenticate (decision block 37) theperson presenting a token for payment at the transaction location. Thetoken being presented at the transaction location is swiped (logic block16) obtaining the necessary account information and sent to a processor15 for comparison with account information stored in the transactioninformation database 33 within the tokenless processing system. If amatch occurs with account information stored in the transaction database33 of the tokenless system, the token system then requires the token tobe authenticated by a biometric (decision block 37). The biometricinformation is gathered (logic block 18) and then sent either separatelyor in parallel with the transaction information (logic block 28) to thetokenless system for approval.

If the account information is sent to the tokenless system transactionprocessor 15 and there is no existing account in transaction database33, then the transaction information would be processed by the normalprocedures for handling the token at the transaction location byelectronic verification unit 10. If the transaction location normallyrequires a biometric for the processing of a token then the check/tokenaccount information 16 and the biometric information 18 can be gatheredat the onset of the transaction and the tokenless databases 33, 35 thenwould be additional databases that would be checked. The transactioninformation database 33 and the biometric database 35 can be the samedatabases for both token-based and tokenless systems. Likewise, thecentral processor 12 handling token-based transactions (arrow 29) can bea separate processor or the same processor handling the tokenlesstransactions.

The present invention of the electronic transaction verification systempreferably includes the capability to return a report to amerchant/vendor upon request, as shown in FIG. 5. As so embodied, aninquiry and/or request is made from a merchant directed towards thecentral processing system 12, shown by logic block 94, which requests aspecific report or series of reports. The central processing system 12preferably includes access to a variety of databases 96, whichpreferably contains separate databases including a database indicativeof a number of checks cashed for a given account, shown by database 98,locations of checks cashed for a specific account, shown by database100, and a database containing various information regarding thecustomers of the account, shown by database 102. The central processingsystem 12 selectively accesses and interacts with these databases inresponse to the inquiry from the merchant at logic block 94, andgenerates a report on the specific customer or customers, shown byprocessed data logic block 104. The processed data then is returned inreport form to the specific merchant, shown by logic block 106, whichmade the inquiry and request to generate the report. Such informationgenerated by the verification system can prove highly informative as tocustomer trends such as drops in frequencies of purchases, customerdissatisfaction, or other trends that can then be effectively targetedby marketing efforts.

The present inventive electronic transaction verification system furtherprovides that after the biometric identification data, such as afingerprint, has been imprinted on the check, the present invention canalternately be used at a bank in conjunction with the proofing machineto determine if the biometric identification data on the check is thatof the account owner. As shown in FIG. 6, the biometric data from thebiometric scanning device 110, preferably at the transaction location112, is sent, either electronically or physically, to the proofingmachines for checks or negotiable instruments 114, typically at a bankprocessing center 116. In the past, checks were typically sentphysically to a bank or processing center and the magnetic line of thecheck physically scanned by the proofing machine 114. Currently, manychecks are being truncated electronically and the information containedtherein is being processed directly or indirectly by host computers atthe bank or processing centers.

In the embodiment shown in FIG. 6, the biometric data is printed on thecheck by the biometric scanning device 110 and the printed biometricdata is scanned, and thus gathered, in addition to the magnetic numbersof the check. A comparison step preferably occurs within the proofingmachine 114 during the batch processing and scanning of the magneticnumbers of the checks for transfer of funds from the accounts. Thebiometric data is retrieved and updated from a first biometric database118 that contains the biometric data for known customers havingaccounts. The proofing machine 114 also preferably perform a comparisonstep with a second biometric database 120 containing biometric data forknown invalid users who have perpetrated, or attempted to perpetrate,fraudulent activity with regard to tendering checks/negotiableinstruments. Databases 118 and 120 can reside on the proofing machine114, or can be located remotely. Such information in biometric database120 is preferably also accessible by the biometric scanning device 110at the transaction location 112 for updating and comparing, eitherseparately from or in conjunction with, the proofing machine 114. If thecheck/negotiable instrument being compared was tendered fraudulently,the biometric database 120 is useful for determining the perpetrator'sactual identity, and comparison between databases 118 and 120 can alsobe made for identity determination. In that regard, biometric database120 is also accessible by central processing system 12, identificationdatabase 14, central database 30, as well as electronic transactionverification unit 10 for detection of known fraudulent users.

The present invention can be utilized in a variety of forms with avariety of sources of information other than those described in detailherein. As an example, the electronic transaction verification systemcan be interfaced to various transaction and identification informationdatabases containing customer account information and biometricinformation.

While there have been shown a preferred and alternate embodiments of thepresent invention, it is to be understood that the invention may beembodied otherwise than is herein specifically shown and described, andthat within the embodiments, certain changes may be made in the form andarrangement of the parts without departing from the underlying ideas orprinciples of the present invention of an electronic transactionverification system set forth in the claims appended herewith.

What is claimed is:
 1. A negotiable instrument system for use at alocation where a negotiable instrument is presented by an individual,comprising: a negotiable instrument scanner configured to read encodednegotiable instrument information data on the negotiable instrument whenit is presented; a biometric scanner configured to generate biometricdata from the individual presenting the negotiable instrument; aprocessor configured to: access an identification database using atleast the generated biometric data and personal information associatedwith the individual including at least one of a date of birth or adriver's license number at the time of presentation of the negotiableinstrument, to locate in the database and identify the individualpresenting the negotiable instrument to authenticate the identity of theindividual presenting the negotiable instrument, and analyze thenegotiable instrument information data to determine if the negotiableinstrument should be rejected, wherein the processor is configured toaccess the identification database by comparing at least the generatedbiometric data with biometric data stored in the identificationdatabase.
 2. The system of claim 1, wherein the negotiable instrument isa check.
 3. The system of claim 2, wherein the check is a cashier'scheck.
 4. The system of claim 2, wherein the individual is the payee onthe check.
 5. The system of claim 2, wherein the negotiable instrumentinformation data is the check number on the check.
 6. The system ofclaim 1, wherein the system returns a report on the usage of the systemby the individual presenting the negotiable instrument.
 7. The system ofclaim 1, wherein the system prints the biometric data of the individualpresenting the negotiable instrument on the negotiable instrument. 8.The system of claim 1, wherein the biometric scanner is a fingerprintscanner.
 9. The system of claim 1, wherein the negotiable instrumentscanner and the biometric scanner are located remotely from theidentification database.
 10. The system of claim 1, wherein thenegotiable instrument scanner and the biometric scanner are local withthe identification database.
 11. The system of claim 1, furthercomprising a negotiable instrument information database, wherein thenegotiable instrument information data is analyzed by comparing thecheck number to check numbers in the negotiable instrument database. 12.The system of claim 1, wherein the processor is configured to analyzethe negotiable instrument information data by comparing the negotiableinstrument information data with negotiable instrument informationstored in a negotiable instrument database and associated with at leastone of a biometric information, birth date, name, address or driver'slicense number associated with the individual.
 13. A method ofprocessing a negotiable instrument tendered by an individual, the methodcomprising the steps of: obtaining encoded negotiable instrumentinformation from the negotiable instrument using a negotiable instrumentscanner at the time it is tendered; obtaining biometric data from theindividual tendering the negotiable instrument using a biometric scannerat the time the negotiable instrument is tendered; at the time thenegotiable instrument is tendered: accessing an identification databaseusing at least the obtained biometric data and personal informationassociated with the individual including at least one of a date of birthor a driver's license number to locate in the database the individualtendering the negotiable instrument and authenticate the identity of theindividual presenting the negotiable instrument, obtaining informationabout usage of the system by the individual tendering the negotiableinstrument; and comparing the negotiable instrument information withinformation previously stored in a negotiable instrument informationdatabase to determine if the negotiable instrument should be rejected.14. The method of claim 13, wherein the negotiable instrument is acheck.
 15. The method of claim 14, wherein the individual is the payeeon the check.
 16. The method of claim 14, wherein the negotiableinstrument information is the check number on the check.
 17. The methodof claim 13, further comprising the step of providing a report on theusage of the system by the individual presenting the negotiableinstrument.
 18. The method of claim 13, further comprising the step ofprinting the biometric data on the negotiable instrument.
 19. The methodof claim 13, wherein the step of obtaining biometric data comprisesobtaining a fingerprint.
 20. The method of claim 14, wherein the step ofcomparing the negotiable instrument information comprises comparing acheck number of the check to check numbers in the negotiable instrumentdatabase.
 21. The method of claim 13, wherein the information previouslystored in the negotiable instrument information database is associatedwith at least one of a biometric information, birth date, name, addressor driver's license number associated with the individual.
 22. Anegotiable instrument processing system, the system comprising: anegotiable instrument scanner that is configured to read data encoded onthe negotiable instrument; a biometric data scanner that is configuredto obtain biometric data from the individual presenting a negotiableinstrument at the time the negotiable instrument is presented; a firstbiometric database that stores biometric data for users of thenegotiable instrument verification system; and a negotiable instrumentdatabase; wherein at the time the negotiable instrument is presented,the negotiable instrument processing system is configured to access thefirst biometric database using at least the obtained biometric data andpersonal information associated with the individual including at leastone of a date of birth or a driver's license number to locate in thedatabase the individual presenting the negotiable instrument and furthercompare the biometric data from the individual to data in the firstbiometric database to authenticate the identity of the individualpresenting the negotiable instrument; and wherein the negotiableinstrument processing system is configured to compare the encoded datato data in the negotiable instrument database to determine whether toreject the negotiable instrument.
 23. The system of claim 22, whereinthe negotiable instrument is a check.
 24. The system of claim 23,wherein the check is a cashier's check.
 25. The system of claim 24,wherein the individual is the payee on the check.
 26. The system ofclaim 23, wherein the negotiable instrument information data is thecheck number on the check.
 27. The system of claim 22, wherein thesystem returns a report on the usage of the system by the individualpresenting the negotiable instrument.
 28. The system of claim 22,wherein the system prints the first biometric data of the individualpresenting the negotiable instrument on the negotiable instrument. 29.The system of claim 22, wherein the biometric data scanner is afingerprint scanner.
 30. The system of claim 22, wherein the negotiableinstrument scanner and the biometric data scanner are located remotelyfrom the biometric database.
 31. The system of claim 22, wherein thenegotiable instrument scanner and the biometric scanner are local withthe biometric database.
 32. The system of claim 22, further comprising anegotiable instrument information database, wherein the negotiableinstrument information data is analyzed by comparing the check number tocheck numbers in the negotiable instrument database.
 33. The system ofclaim 22, wherein the encoded data is character recognition data that isprinted on the negotiable instrument.
 34. The system of claim 22,wherein the system prints biometric data from the individual on thenegotiable instrument.
 35. The negotiable instrument processing systemof claim 22, wherein the biometric data is used to access a secondbiometric database to determine if the individual presenting thenegotiable instrument is an invalid user.
 36. The system of claim 22,wherein the data in the negotiable instrument database is associatedwith at least one of a biometric information, birth date, name, address,or driver's license number associated with the individual.
 37. Atransaction processing system located at a transaction location, thesystem comprising: a device configured to obtain biometric data from anindividual presenting a token; and a processor configured to access anidentification database located at the transaction location using atleast the obtained biometric data and personal information associatedwith the individual including at least one of a date of birth or adriver's license number to locate in the database and identify theindividual presenting the token to verify the identity of the individualpresenting the token.
 38. The system of claim 37, further comprising ascanner configured to read information stored on the token presented bythe individual.